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| Tata Power to raise $250 million |
| BS Reporter / Mumbai Nov 07, 2009, 01:04 IST |
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India’s largest private sector power utility Tata Power Company today said it planned to raise $250 million (Rs 1,170 crore) by issuing foreign currency convertible bonds (FCCBs) to fund its power projects.
The company has launched the $250-million FCCB issue, which includes a greenshoe option to raise another $50 million. The bonds will mature in five years and will have a yield-to-maturity of 3.5 per cent on a semi-annual basis, according to a press release.
The bonds are convertible at a premium of 10 per cent over Rs 1,323.75, the closing price of Tata Power’s shares on the National Stock Exchange of India yesterday. They are expected to be listed on the Singapore Stock Exchange.
Tata Power has to raise Rs 5,575 crore by 2012 to fund the equity portion of six projects under development and for capital expenditure of about Rs 420 crore each year for three years.
In 2009-10, the company has to infuse Rs 1,800 crore, which includes Rs 804 crore for its Mundra Ultra Mega Power Project (UMPP) and Rs 500 crore for the Maithon power project, a joint venture with Damodar Valley Corporation. It also plans to infuse Rs 17 crore as equity in a tubed coal project and another Rs 10 crore into the Mandakini coal block development project. Tata Power also has to put in Rs 44 crore in the Daggacchu hydro power project in Bhutan. Tata Power also requires a debt of about Rs 23,600 crore by March 2012 to complete its ongoing expansion plans. The company has already tied up for debts and other loans from various financial institutions for about 18,100 crore. In July, Tata Power had raised $335 million (about Rs 1,619 crore) through issue of securities in the international markets. Further, TPC had sold part of its stake in group telecom company, Tata Teleservices, for Rs 316.72 crore.
According to Tata Power sources, plans are to raise Rs 2,800 crore through internal accruals and the rest through dilution of equity of subsidiaries, disinvestment of various holdings or assets and dilution at parent level through various vehicles. “We have adequate time to raise the rest of the equity amount,” Tata Power Executive Director S Ramakrishnan had said last week. The company is implementing about 5,320 Mw of thermal power projects, which include the 4,000-Mw Mundra plant and the 1,050-Mw Maithon plant. Besides, the company is implementing 98 Mw of wind power in Maharashtra. The company is looking to commission the projects by 2013, with a view to increase its power generation capacity from 2,800 Mw to over 8,000 Mw. It is also planning to strengthen its power transmission and distribution systems in Maharashtra with an investment of over Rs 1,000 crore within a few years. The Tata Power stock closed at Rs 1,271.50, down 3.84 per cent at close of Friday’s trade on the Bombay Stock Exchange.
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